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CIMAPRA19-P03-1 Exam - Topic 4 Question 41 Discussion

D plc is a public relations company. Shares in D plc have recently been listed on the UK stock exchange.D plc has an internal audit department that reports to the Chief Executive Officer (CEO). The CEO is considering outsourcing internal audit to an audit firm, whichwould not be the firm that conducts D plc's external audit.Identify THREE advantages to D plc of outsourcing internal audit in this way.
C) Internal audit will have a better understanding of D plc's objectives and culture. and E) Risk of staff turnover is passed to the outsource company.
A) Doing so may improve independence.
B) Decisions relating to internal audit can be based solely on cost.
D) Specialist skills may be more readily available.

CIMAPRA19-P03-1 Exam - Topic 4 Question 41 Discussion

Actual exam question for CIMA's CIMAPRA19-P03-1 exam
Question #: 41
Topic #: 4
[All CIMAPRA19-P03-1 Questions]

D plc is a public relations company. Shares in D plc have recently been listed on the UK stock exchange.

D plc has an internal audit department that reports to the Chief Executive Officer (CEO). The CEO is considering outsourcing internal audit to an audit firm, whichwould not be the firm that conducts D plc's external audit.

Identify THREE advantages to D plc of outsourcing internal audit in this way.

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Suggested Answer: C, E

by Virgie at Mar 16, 2024, 08:51 PM

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Fannie
8 months ago
Decisions based on cost? That's a double-edged sword.
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Vernice
8 months ago
Specialist skills are a big plus for outsourcing!
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Anglea
8 months ago
Wait, are they really considering this? Sounds risky.
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Vince
8 months ago
I disagree, internal teams know the company better!
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Shizue
9 months ago
Outsourcing can definitely improve independence.
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Margarita
9 months ago
Passing the risk of staff turnover to the outsource company sounds good, but I wonder if it really benefits D plc in the long run.
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Denny
9 months ago
I'm a bit confused about whether decisions should be based solely on cost; I feel like there are other factors to consider too.
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Ellsworth
9 months ago
I remember a practice question about outsourcing internal audit, and I think having specialist skills available is a strong advantage.
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Tegan
9 months ago
I think outsourcing could improve independence, but I'm not entirely sure how that plays out in practice.
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Pearlie
9 months ago
Okay, I think I've got a good handle on this. The key advantages I see are improved independence, access to specialized skills, and reduced risk of staff turnover. I'll make sure to explain each of those clearly in my answer.
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Elly
9 months ago
Hmm, I'm a bit unsure about this one. I need to make sure I understand the differences between internal and external audit before I can identify the advantages of outsourcing. Maybe I'll start by reviewing my notes on that.
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Harris
9 months ago
This seems like a straightforward question about the advantages of outsourcing internal audit. I'll focus on identifying the key benefits that are directly relevant to the scenario.
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Stephen
10 months ago
This question is asking for specific advantages, so I'll need to be careful to avoid just listing general pros of outsourcing. I'll need to tie the advantages directly to the context of D plc and their internal audit function.
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Talia
10 months ago
Based on my understanding of packet-based analysis, I think option B is the most accurate statement. The key is that it's focused on metadata capture rather than just raw packet data.
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Ernestine
10 months ago
It seems like a lot of factors contribute, but I'm unsure if reductions in drug costs have really driven demand.
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Vannessa
10 months ago
I think the capacity to handle existing and future records is crucial, but I'm not completely sure if that's the most important feature.
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Clorinda
10 months ago
No problem, I've done this type of task before. I'll just breeze through the steps in option A and have the report ready in no time.
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Stanton
1 year ago
I'm just wondering if the CEO is trying to cut costs so they can have a bigger budget for the company's annual retreat. You know, team-building exercises and all that jazz.
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Lizbeth
1 year ago
Outsourcing internal audit? I hope they don't end up with a bunch of bean-counters who have no idea how to make a good PR move. That would be a PR nightmare!
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Frederic
1 year ago
C) Internal audit will have a better understanding of D plc's objectives and culture.
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Polly
1 year ago
Outsourcing internal audit can bring in specialist skills that may benefit D plc.
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Darrin
1 year ago
E) Risk of staff turnover is passed to the outsource company.
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Cyril
1 year ago
A) Doing so may improve independence.
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Justine
1 year ago
What, they're considering outsourcing just to save money? That's a recipe for disaster. Internal auditors need a deep understanding of the company's culture and objectives.
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Deonna
1 year ago
I agree that specialist skills may be more readily available through outsourcing. Plus, the outsource company can handle the risk of staff turnover, which is a bonus.
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Candida
1 year ago
E) Risk of staff turnover is passed to the outsource company.
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Lelia
1 year ago
C) Internal audit will have a better understanding of D plc's objectives and culture.
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Alecia
1 year ago
A) Doing so may improve independence.
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Paz
1 year ago
Outsourcing internal audit could definitely improve independence, as the auditors would be from a separate firm. However, I'm not sure if cost should be the sole factor in the decision.
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Mike
1 year ago
Outsourcing internal audit could definitely improve independence, as the auditors would be from a separate firm. However, I'm not sure if cost should be the sole factor in the decision.
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Ressie
1 year ago
C) Internal audit will have a better understanding of D plc's objectives and culture.
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Myra
1 year ago
A) Doing so may improve independence.
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Catarina
1 year ago
Outsourcing internal audit could definitely improve independence, as the auditors would be from a separate firm. However, I'm not sure if cost should be the sole factor in the decision.
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Charisse
1 year ago
C) Internal audit will have a better understanding of D plc's objectives and culture.
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Katlyn
1 year ago
A) Doing so may improve independence.
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Rosina
1 year ago
But what about the risk of staff turnover being passed to the outsource company?
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Cathrine
1 year ago
I agree with Ashleigh. It could also bring in specialist skills.
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Ashleigh
1 year ago
I think outsourcing internal audit could improve independence.
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